Obamacare’s Burden on Businesses

Alyssa Badolato /
March 11, 2013

Obamacare is approaching its three-year anniversary next week. And while it’s having an impact on nearly all Americans in one way or another, businesses are facing some of the biggest challenges related to the law.

Heritage hosted a panel Monday to examine the implications of the Affordable Care Act. Robert Graboyes, a senior fellow for health and economics at the National Federation of Independent Business Research Foundation, explained the three options employers face with Obamacare: stunt business growth, shrink employee hours, or minimize the damage the mandate does on the employer’s wallet.

That’s the case for Mike Ruffer, who works in restaurant business. Ruffer purchased the franchise rights from Five Guys in 2004 with a commitment to build 11 restaurants. Ruffer owns eight Five Guys in North Carolina, but worries about opening new restaurants because of the uncertainty related to impending federal regulations.

In his words, Ruffer is stuck “not knowing what he doesn’t know.” He has been educating himself through countless webinars discussing what to expect from the law’s employer mandate. The answers have left him uneasy.

In the beginning stages of Obamacare, Ruffer said he didn’t think he’d be affected by the mandate because no single restaurant employs more than 50 workers. In such a case, the employer is required to provide health care or pay an assessment so employees can receive a premium tax credit. Ruffer soon found out, however, that his eight restaurants are counted as one entity — despite each restaurant having fewer than 20 employees.

It’s just one example of how employers are grappling with Obamacare. Businesses are delaying expansion plans, cutting back on employee hours or raising the price of goods for consumers to cover the cost of compliance.